ARBITRATION IN THE LIFE SCIENCES AND PHARMACEUTICAL SECTOR

CD: How would you describe the appetite among companies operating in the life sciences sector, to use arbitration to resolve their disputes?

Lindsay: Our perception is that the appetite for arbitration is on the rise. The WIPO Arbitration and Mediation Center (WIPO Center) reports approximately 15 percent of its current case load as involving the life sciences industry. The ICC International Court of Arbitration and American Arbitration Association’s (AAA) International Centre for Dispute Resolution (ICDR) recorded an average of 30 international arbitration cases relating to health, pharmaceutical and body care matters submitted annually between 2011 and 2015. There are a number of features of arbitration that make it suitable for the life sciences sector, including the confidential nature of proceedings, the possibility of appointing arbitrators with sector-specific expertise, the bespoke nature of the arbitration agreement and the greater ease of enforceability of arbitral awards internationally than court judgments.

Toscano: The growth in the use of arbitration among entities operating in the life sciences sector may be related to the advantages that it presents, such as confidentiality, the ability of parties to control procedures and to select decision makers with expertise, the ability to resolve multiple national disputes in one forum and international enforcement of arbitral awards. To date, 15 percent of arbitration and mediation cases filed with the WIPO Center have related to life sciences, with a noticeable increase in recent years. Parties to these cases were research institutes, universities, hospitals and SMEs involved in the pharmaceutical, biotechnology and medical devices industries, and they were mainly based in Asia, Europe and North America. While the cases varied in their complexity, the amounts in dispute were as high as $1bn. We have also noted an increase of the referral of life sciences disputes to mediation.